The Swiss financial regulator has come down hard on UBS' investment-banking arm, putting the brakes on any expansion plans it may have entertained. The problem is, the investment bank was already in reverse.

According to a statement yesterday from Finma, the Swiss Financial Market Supervisory Authority: “Any new business initiatives which UBS intends to take in its investment bank and which are likely to lead to increased operational complexity require prior approval from Finma.”

UBS’s investment bank will also be unable to make acquisitions. Both constraints are in place “until further notice”.

The move comes after last week’s conclusion of the trial of former trader Kweku Adoboli, who caused a $2.3bn loss through unauthorised trading last year.

However, Andrew Lim, banks analyst at Espirito Santo Investment bank, said of the Finma constraints: “This is inconsequential. They were not going to make an acquisition in the first place, so it is not going to matter that they have got a ban.”

The last time UBS’s investment bank made a meaningful acquisition was in 2006, when it bought Banco Pactual in Brazil for $2.6bn. It sold the business in 2009 for $2.5bn.

UBS is also unlikely to be announcing new expansionary business initiatives in the near future. In October, it said it plans to cut 10,000 staff and all-but-exit fixed-income trading, a capital-intensive business. UBS’s share price has risen by over a fifth since the announcement.

An analyst at a rival bank said: “If UBS was a business-as-usual type of bank, this would be an issue. But UBS is a business-as-unusual bank, and is dramatically reducing operational complexity. Most of its efforts are already going in the direction its regulator wants it to go.”

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Lim said: “The announcement was just a case of the regulator making it clear there isn’t a possibility of UBS ramping up its investment bank.”

However, for others, the announcement that Finma will be constantly keeping tabs on UBS deals a blow to the bank.

Christopher Wheeler, banks analyst at Mediobanca, said: “You don’t want your regulator putting you in this kind of position. The reality is, you want to be able to run your own business day to day for the benefit of shareholders, rather than having your regulator effectively dictating strategy to you.”